Funds Premier League: Undervalued success

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Global funds

M&G Global Dividend

At 32, Stuart Rhodes is one of our youngest Premier League members. After graduating from Bath University he joined M&G as an equity analyst in 2004. Just four years later M&G launched the Global Dividend fund and entrusted Rhodes to run it.

Launching it just before the financial crisis hit proved challenging, but over each of the past three years the fund dished out a healthy 12.6% annualised return.

How does Rhodes do it? He invests in around 50 global companies, Novartis (NVS), Chubb (CB) and Johnson and Johnson (JNJ) being his biggest holdings.

He's a stockpicker who looks for companies that are capable of growing their dividends and that are undervalued by the market. "We try and stay away from companies with high yields," Rhodes says. "A high yield is often a sign of trouble or low growth potential. I'm not interested in investing in companies that aren't capable of growing their dividends."

Although Rhodes looks for individual companies rather than favouring particular sectors or regions, he does have 40% of the portfolio invested in the US and almost a quarter in financial companies.

Next up: The Funds Premier League member from the UK Smaller Companies sector.